Firms should hire additional units of a resource as long as the
a. marginal product of the resource exceeds the price of the resource multiplied by the quantity of output produced.
b. marginal product of the resource is less than the price of the resource.
c. price of the output produced is positive.
d. marginal revenue product of the resource exceeds the cost of employing an additional unit of the resource.
D
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Experimental effects, such as the Hawthorne effect,
A) generally are not germane in quasi-experiments. B) typically require instrumental variable estimation in quasi-experiments. C) can be dealt with using binary variables in quasi-experiments. D) are the most important threat to internal validity in quasi-experiments.
When MFC < MRP, a firm in a competitive market will
A) stop hiring more workers. B) hire more workers. C) earn fewer profits. D) layoff workers.